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Critical Illness Insurance

Critical illness insurance cover is one form of insurance protection, designed to provide the policyholder with financial security in the event of a critical illness being diagnosed. This type of insurance policy has been controversial in recent years, hitting the headlines for all the wrong reasons.

The Financial Services Authority is cleaning up the industry, making critical illness insurance clearer and safer for the consumer. As in all insurance types, the more you learn about a policy and the more open you are when applying, the better your insurance experience is likely to be.

Who chooses critical illness insurance?

Critical illness insurance policyholders are those people who are concerned about the financial security of themselves or their family in the event that they develop a critical illness.

What is critical illness insurance?

Critical illness insurance pays the policyholder a tax-free sum if he or she is diagnosed with a critical illness. The type of illnesses that are covered is included on a critical illness list that the policyholder should be aware of before committing to the policy.

What kind of illnesses are covered by critical illness insurance?

Each different insurance company will have a list of policies that their critical illness insurance covers. Generally, these include things like cancer, heart attack, organ transplant, kidney failure, stroke, multiple sclerosis, and coronary artery bypass. A number of other illnesses may be covered, such as brain tumour, motor neurone disease, Parkinson’s disease, etc.

What does the lump sum paid out by critical illness insurance cover do?

The way in which the policyholder spends the sum provided by the insurance company is entirely up to them. Depending on their illness, some policyholders may choose to spend the money on private health treatment, whilst others spend the money in a variety of different ways. Would-be policyholders should remember that critical illness cover is not private medical insurance. PMI covers acute illnesses, whereas critical illness cover pays out in the event of a critical illness diagnosis.

  • For more information on Critical Illness please use the guide on Life Insurance, or alternatively you can apply now.
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